I JUST NEED THE ANSWER FOR: B, C, D, and E

Efforts are being made to develop an effective vaccine against Covid-19. Such a vaccine will have great economic and health significance. Vaccines are expensive, and drug companies are depending on revenues that at least cover the development costs.

Assume that the pharmaceutical company VacFirst is the only company that can manage to develop a vaccine which works and which satisfies the requirements of the authorities. Once developed, many other drug companies requires the expertise to copy the invention and get started on the production.

(a) The world leaders have agreed that no one but VacFirst should be allowed to sell the vaccine if they develop it. There are various reactions to such a ban against copy production. Some believe that the ban will lead to an unnecessarily high price the vaccine and thus that only a small proportion of the world's population has access to it. Others believe that the vaccine will not be developed if VacFirst does not get the exclusive right and thus allowed to set a high price (if they themselves want this).

How would you rate these two reactions in light of economic theory? Is one of them right, and the other wrong? Illustrate your discussion and arguments using figures / models, where you explain the connection between the figures / models and the arguments.

(b) Assume that the Heads of State implement what they have agreed, so that VacFirst has the exclusive right to sale of the vaccine. Willingness to pay for vaccines varies between countries, and provides the following demand function aimed at the vaccine of VacFirst

= 200 - ,

where p is the price per vaccine and X is the number of vaccines sold.

What price will VacFirst charge for a vaccine if the marginal cost is constant and same as 2.

(c) What is VacFirst's profit, before the cost of developing the vaccine is deducted?

(d) Now assume that several central countries choose not to respect the agreement to grant the exclusive right to VacFirst. Manufacturers in these countries are thus free to copy and sell the vaccine intheir respective home countries. VacFirst believes this has major consequences for the demand for their vaccine, and that demand will now be

= 200 - 2.

Compare this demand function with that given in 3b) and give an economical one interpretation.

(e) What will be the vaccine price with the new demand function, how many vaccines will

VacFirst sell, and what will be the profit (before development costs are deducted)?

(f) The heads of state are uncertain about the size of VacFirst's development costs, and they are now worried that the company will not develop the vaccine - so no one gets vaccinated, and not in the countries that will allow copy production. Explain based on economic theory why the concerns of heads of state are justified.